Knowledge Library

The Emergence of Retail Trends Within the South African Context

South Africa is an emerging market and the retail space
is clearly different from that of the more developed countries in Europe and
North America.

The local market has to cater for a lower-income
demographic and is clearly segmented according to price. We also have a more
shopping centre-oriented market as opposed to the international market where
high street shopping takes centre stage, says Jonathan Katz, Managing Director
of South Africas leading organic fashion brand, Earthchild and Earthaddict Clothing, offering high quality childrens
and women apparel.

Jonathan outlines how factors such as fair trade,
ethical consumerism and sustainability are the major trends in the retail space
at the moment. Now more than ever retailers need to utilise CRM and social
media  entering into direct dialogue with customers to ensure brand
understanding and customer return visits, says Jonathan.

With the always-on internet access that such a
growing proportion of the public is now enjoying, it has become incredibly easy
to share information about a brand to a massive audience. Its important for
retailers, then, to ensure they know what people are saying about their brand
and be in a position to respond to happy or unhappy customers in a meaningful
way.

What does Fair Trade actually mean?
The Fair
Trade movement promotes standards for fair labour, environmentalism, social
policy, fair pricing and community development.

It is a
trading partnership, based on dialogue, transparency and respect that seeks
justice in production and trade processes, facilitating the empowerment of
small-scale farmers and farm workers enabling community upliftment.

Right now, the biggest factors affecting
purchasing behaviour are:

Differentiation,

Fashionability

Quality and value for money

The basics of customer service

There has
also been a noticeable growth in new shopping centres in the last few years.
Jonathan predicts that many will struggle and believes that the larger regional
shopping centres will dominate for the foreseeable future, while the smaller
ones will find conditions more challenging. Within South Africa, there are
still some areas that are under serviced, so opportunity exists for new shopping
centres here, but the main city centres are currently over-serviced, says
Jonathan.

Lifestyle
centres have also sprung up and are generally smaller without necessarily being
viewed as pure shopping destinations, offering a mix of food and entertainment
as its main draw cards. Shopping centres have a much more diverse offering,
ranging from supermarkets to fashion and other retail stores to appeal to
shoppers.

Looking
into the future, Jonathan comments on how a big move towards online shopping and
interesting promotions similar to the Groupon concept will emerge as well as
the increasing importance of customer service taking the new Consumer
Protection Act into consideration with the publics expectations of good
customer service.

Its
always insightful to compare the appearance of display windows with leading
international brands that spend a fortune on creative, eye-catching window
displays, says Jonathan. With more leading international brands coming to our
shores every year, it is likely to force the local market to up its game.

A way to
boost the shopping experience for the consumer is to extend a wider variety of
food court offerings that aim to offer healthier or organic food options.

Differentiation
is another important aspect of competition and the four Ps including the
fifth, to whom many refer to as clever packaging together with a great
merchandising system (creative and eye-catching store displays) is a great way
to differentiate from competitors and catch the eye and attention of consumers.

Jonathan
says that a brand is everything. It creates aspiration and the product
personality. A product without personality is like a bicycle without wheels so
brand marketing should always take centre stage  from this, specific product
marketing activities can help to boost sales, but only once effective brand
marketing has educated customers about the intrinsic values and benefits of the
brand.

Lastly, we
are all motivated to purchase certain products and services for a reason. For
some, there are ethical and sustainable values that are embraced by certain
products and brands. Jonathan mentions how the forerunner on this was
definitely Anita Roddick and the Body Shop  they introduced the concept of
ethical consumerism as we understand it today to the mass market.

We have
all become more aware of brand ethics and principles, and I believe that those
retailers who offer ethical products will be a step ahead of their competition
as well as have an additional product or service offering. Ethical purchases
also offer an opportunity for consumers to see how their money is being used to
do good.

The countdown to the Black Friday and Cyber Monday sales has officially begun. With experts predicting shoppers will spend double the amount they did in 2015 – this year’s retail shopping bonanza is expected to be bigger than ever.

As the physical and digital worlds continue to merge, it is becoming clear that as a retailer it is all about that providing the consumer with that consistent brand experience to strengthen that relationship and help them in their path to purchase.